Michael Masi was removed as F1 race director as part of a restructure at the governing body of the sport.
The inquiry into the end of the World Championship resulted in a series of changes.
Masi had a direct impact on the outcome of the title race because he failed to apply the rules correctly.
Extra help will be provided to officials as two men alternate in the role.
The new race directors will be Eduardo Freitas, who was previously the race director in the World Endurance Championship, and Niels Wittich, who was the race director in the DTM German Touring Car Championship.
F1 veteran Blash was the deputy race director under Charlie Whiting.
The race director role was taken over by Masi when Whiting died.
Ben Sulayem said that Masi would be offered a new position.
Direct radio communications between the teams and the race director will no longer be allowed as part of a restructure of race control.
Masi was under pressure from the Mercedes and Red Bull teams to make decisions in their favor. The huge controversy after the race arose from the fact that he seemed to follow Red Bull's suggestions, to the advantage of their driver Max Verstappen over Mercedes' Lewis Hamilton.
Verstappen used his fresh tyres to overtake Hamilton on old ones and win his first world title after Masi failed to correctly apply the rules.
Hamilton had dominated the race and was on the verge of winning his eighth championship.
Wolff said that Hamilton was left "disillusioned" with F1 as a result of events in Abu Dhabi.
The new year revealed that Hamilton wouldn't commit to an F1 return until he saw how the FIA would address the issue.
The Mercedes F1 car launch on Friday will be the first public appearance by the 37-year-old since Abu Dhabi.
The decisions of the FIA amount to substantive action but are also effective admission mistakes.
He emerged on social media earlier this month, and has appeared in Mercedes videos and photographs on social media.
He will race in F1 this season.
According to well defined procedures, teams will still be allowed to put questions to race control.
To keep the direct pressure off the race director, a new layer of staff in race control is expected to be addressed.
Charles Leclerc said he had a lot of respect for Michael.
It was always going to be controversial. I fully trust that the decision the FIA has made is the right one.
The report into the failures at Abu Dhabi will be published at the season opening race in March, according to a spokesman for the governing body.
The video assistant referee in football will be a thing of the past with the addition of a remote race control.
The plan was presented to the teams at a meeting of the F1 Commission on Monday, but this is contrary to what Ben Sulayem said.
He said that it had received full support from the World Council and Senate.
This plan opens the way for a new step forward in Formula 1 refereeing. There is no sport without the referees.
The essence of the FIA is respect and support of the referees. Structural changes are important in a context of strong development and legitimate expectations of drivers, teams, manufacturers, and of course the fans.
The changes will allow us to start the Formula 1 season in the best conditions, and our sport will be even more loved and respected.
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